Sell apartments or keep them?

Hi,

a sale within the family is not possible because the family is quite small and almost everyone is involved. :D

The shares refer to the whole. There is no division into specific apartments. "Everyone owns everything proportionally."
Why is this complicated? An apartment is sold by the community of heirs and the sales proceeds are divided proportionally (1/3 mother, 1/3 uncle, 1/6 brother, 1/6 me). Why the large price reduction?


No, my father's house is (unfortunately) 500 km away and is rented out. My parents live (as the only co-owner) themselves as tenants in one of the two rental buildings.


Regards

The shares are understood as part of the whole. There is no allocation to specific apartments. "Everyone owns everything proportionally." Why is this complicated? An apartment is sold by the community of heirs and the sales proceeds are divided proportionally (1/3 mother, 1/3 uncle, 1/6 brother, 1/6 me). Why the high price discount?

First: Division of the houses into individual ownership Secondly: Find someone who wants to buy the apartment - Attention! Right of first refusal for the tenants Thirdly: The price for this person is probably set to zero, since the apartment is burdened with a usufruct. Why price = 0? Because all income from the apartment does not belong to the owner but to the usufructuary. Alternatively: Have the usufruct cancelled. For all points, the entire community of owners must decide jointly. A management of the apartments according to the Condominium Act (WEG) is then also necessary. Not an easy decision.

Last point: Is the plot + your father's parental house located within the building area you have chosen? Would further construction on it be an option (land division and house construction)? Then you would have already significantly reduced your construction costs, as you would not have to buy another plot.

Hardly, given the stated value.

First: Division of the houses into individual ownership
Second: Find someone who wants to buy the apartment - Attention! Right of first refusal for the tenants
Third: Probably set the price for this person to zero, since the apartment is encumbered with a usufruct. Why price = 0? Because all income from the apartment does not belong to the owner, but to the usufructuary.
Alternatively: Have the usufruct removed.

For all points, the entire community of owners must decide collectively. Then, administration of the apartments according to WEG is also necessary.

Not an easy decision.

Hi,

the right of first refusal for the tenants would not be a problem for us. You don’t have to search extensively and everyone knows what they are getting into, especially since we have a very good relationship with almost all our tenants.

Is it not possible to have the usufruct removed for the individual (sold) apartments?

But aside from the whole ownership issue: Does it make more sense to do a partial sale to increase equity or rather cover part of the financing with rental income? What are the advantages and disadvantages of each?

The biggest advantage I see if we keep the houses is quite simply that the houses pay off part of the loan, but the real estate remains intact. On the other hand, of course, I am getting into debt with a relatively large sum even though I own several hundred thousand euros in real estate. Somehow also awkward...

Hardly at the given value.

OK - I hadn't paid attention to that.
On the other hand, the parental home could have been a ruin and the stated 200,000 the land value minus the estimated demolition costs. Then it could have fit ;).

I would keep the houses. What you have, you have. And paying off your own loan through rental income is great. What else do you want to do with your capital at such a low interest rate if it is supposed to be relatively safe?

What I haven’t quite understood is your share. You wrote that the houses belong half to your brother and you, but your mother and your uncle have transferred 1/3 each to you, but have usufruct rights. So did your mother and your uncle originally own 2/3 of the house that they transferred to you and your brother? Is your share large enough to make a significant contribution to the repayment?